Towards a just future of Islamic finance: from a new historical comparative east-west perspective

Contemporary increased economic and social pressures have raised concerns among both state regulators and clientele about the ability of banks and others financial institutions to survive. One of the fastest growing and significant parts of the world financial system is Islamic finance, which extends worldwide and exploits a highly sophisticated financial products and procedures based on Shariah. Grounded on unconventional, ethical and religious maxims, Islamic finance seems to be a solution to the current worldwide financial disaster.

Conventional and Islamic financial systems present two entirely different concepts. The former aims for the achievement of financial gain on behalf of a single firm, or even a single person, whereas the latter is in the interest of the whole society. Therefore, these two systems differ not only in regard to their philosophical foundations, but also in terms of the end results. Therefore, without taking into account the technical and juridical peculiarities, Islamic finance affords more Justice.

This raises the question, what does the word “Justice” mean? The concept of social justice does not have a universal moral or indeed legal interpretation. This study analyses the background of theories of justice in order to explain the phenomenon of justice by putting it in both a social and religious context. This is done so that we can see Justice as a socio-philosophical category associated with religious dissimilarities as well as ethical norms in different societies, undivided from their religious roots.

Finally, this thesis compared the Islamic and Conventional financial systems, their ethics and philosophical basis, and different legal systems in combination with various ideas of justice connected with different religions in order to elaborate the potential future of Islamic finance.